government affairs blog

At the recent ALTA convention in Charleston, Insurer Section Chair, Jim Russick and Executive Director, Alan Fields, reported on the recent changes to Florida law regarding the insolvency of a title insurer.   As part of their presentation, they suggested that with insurers issuing policies in multiple states, a uniform national model for handling the assets and policy obligations of a failed insurer was needed. 

Good afternoon and Happy Saturday,

This opinion is a few months old now, but I thought it was worth sharing because it highlights the risks of condo purchasing and ownership.  Long story short, certain members of the condo association had allegedly improperly depleted condo funds.  In order to maintain the association property (and essentially make up for the loss), the board passed a special assessment, and sought to foreclose on Coral Way when it refused to pay the assessment.  Coral Way defended the foreclosure action on the basis that the assessment was improper because it would not have been necessary had the association not improperly squandered funds in the association coffers.  The trial court disagreed and entered judgment in favor of the association.

The Fourth District Court of Appeal (Broward & Palm Beach Counties) agreed with the trial court and upheld the summary judgment of foreclosure.  In sum, although the association may have acted improperly in wasting association funds, the special assessment was properly done consistent with the governing documents, and because Coral Way was an owner, it was liable for the special assessment.

The entire case can be accessed here.

Regards,

Paul

Paul H. Minoff
McGlinchey Stafford PLLC
Direct: (954) 332-3639
Cell: (954) 999-2441
Fax: (954) 333-3847
Email: pminoff@mcglinchey.com

Another Case law update from Paul Minoff at McGlinchey Stafford PLLC

In the further chipping away of the "lack of standing" defense frequently asserted by foreclosure defense counsel, earlier today the Florida Second District Court of Appeal followed the now extensive line of Fourth DCA cases establishing that standing to foreclose will exist without an assignment (or even when the assignment was not signed until after the lawsuit was filed) so long as the foreclosing entity can establish that it holds the note via an endorsement or allonge.  In this case, the court rejected Ice Legal's (the firm that brought us the term "robo-signing") position that standing did not exist, holding that the plaintiff (Bay Loan Servicing) obtained "equitable standing" to foreclose the property based upon the allonge to the note, and that "equitable ownership" of the mortgage also passed to Bayview because the mortgage followed the note. 

Despite this victory, the court ended up reversing the summary judgment in favor of Bayview because Bayview failed to overcome the defendant's lack of proper notice affirmative defense.  In that regard, Bayview did not submit a copy of the default letter required under paragraph 22 of the mortgage in support of its motion for summary judgment.  This case is a stark reminder that when an affirmative defense is raised, it must be responded to and overcome; if not, the judgment is subject to reversal. 

[Ed -- this kind of ruling means we as title examiners have little ability to determine whether the proper party is actually foreclosing beyond the presumption that the court did a proper verification]

A copy of the case can be found here 

Thanks Paul!!

Following the announcement of the revamped Home Affordable Refinance Program (HARP), a handful of media reports indicated that title insurance and closing costs are among the fees that will be reduced or eliminated in the HARP program. ALTA has been assured by the agency responsible for HARP, the Federal Housing Finance Agency (FHFA), that this is not the case.

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Our thanks -- once again -- to Paul Minoff, who periodically sends us updates on cases of interest.    Here's his latest....

Although the attached Florida Fourth District Court of Appeal opinion provides no guidance as to what constitutes "due diligence" for purposes of serving a foreclosure complaint by publication, it does remind us to make sure that our process servers are making a diligent effort to effectuate by service as required by Florida Statutes sections 49.011 and 49.021, and as interpreted by the Fourth DCA in the attached opinion of Parker v. LaSalle Bank.

Please feel free to reach out if you ever have any questions or require assistance with any of your Florida foreclosure matters.

Regards,

 

Paul Minoff  

Paul H. Minoff
McGlinchey Stafford PLLC
Direct: (954) 332-3639
Cell: (954) 999-2441
Fax: (954) 333-3847
Email: pminoff@mcglinchey.com

The Federal Housing Finance Agency this week directed Fannie Mae and Freddie Mac to start transitioning to a new system where mortgage servicers pick the foreclosure attorneys they work with -- not the GSEs.

FLTA has posted several new bulletins on the FLTA website.  Click on the bulletin title for a quick hyperlink.

2011 Bulletin 12  -- How Many Trust Accounts Do I Really Need?

During the boom times, many FLTA members were holding pre-construction deposits on condominium units. Under the Condominium Act, any deposits in excess of 10% of the contract price could be released to the developer to cover certain construction costs.   The normal practice in many parts of the state was to require a 20% deposit.   When the market turned, many purchasers under those contracts sought a refund of their deposits and were rarely successful.

Double AA International Investment Group, Inc. v. Swire Pacific Holdings, Inc., 674 F.Supp.2d 1344 (S.D. Fla. 2009), aff'd in part, vacated in part, 637 F.3d 1169 (11th Cir. 2011) held that the Condominium Act required an escrow agent holding pre-construction deposits in excess of 10% of the purchase price of a condo to maintain totally separate accounts for the amounts in excess of 10% of the purchase price.  FLTA worked with the Florida legislature to overrule this case and were successful, but a recent case held that our “Fix” didn’t work.

This bulletin provides all the details.

2011 Bulletin 13 -- DFS Designation Rule Update

As many of you know, DFS has been working on a rule which would restrict what designations, job titles or other descriptions could be used by title agents and in other categories of insurance.   This bulletin includes the latest version.

2011 Bulletin 14 -- Fees on VA Loans

Title agents have known for years that certain itemized fees are not permitted in a VA loan, and must be covered out of the 1% fee paid to the lender.    A recently unsealed lawsuit attacks the practice of some banks in recharacterizing impermissible fees into “permitted” categories.

2011 Bulletin 15 -- Bar issues UPL Letter on Short Sale Assistance

On September 30, 2011, the Florida Bar’s Standing Committee on the Unlicensed Practice of Law issued its long awaited guidance on whether a title agent’s facilitating a short sale constituted the unlicensed practice of law.   FLTA has been actively participating in the process and the UPL Committee just issued its letter on the subject that is outlined in this bulletin.

The U.S. Supreme Court denied review of a case brought against Mortgage Electronic Registration Systems by a California man, the Court announced Tuesday.

Gomes v. Countrywide is the first major MERS case filed with the U.S. Supreme Court, and centered on whether MERS had a right to foreclose on the homeowner without proving it had the noteholder's authority to foreclose.

More from Housing Wire

The U.S. Supreme Court agreed Monday to clarify the scope of a federal law meant to protect homebuyers from being overcharged for real estate settlement services.

The question the court will resolve is whether a provision of the Real Estate Settlement Procedures Act banning service providers from charging for services they did not actually render applies only when the unearned fees are split between two or more parties.

Three circuit courts have ruled that the law applies to any unearned fees, whether retained by a single defendant or multiple defendants. The Department of Housing and Urban Development's position is in line with these rulings.

Four circuit courts have issued opinions taking the opposing view.

More from Housing Wire

A lawsuit filed in 2006 and unsealed last week in an Atlanta federal court claims several large banks and mortgage companies defrauded veterans by charging illegal fees on Interest Rate Reduction Refinancing Loans offered by the Department of Veterans Affairs.

The lawsuit, brought under the Federal Claims Act by two mortgage brokers, alleges the defendants charged attorney’s fees or settlement closing fees, which are prohibited on VA loans. According to the lawsuit, the companies skirted the rules by hiding attorneys’ fees as title examination or title search fees.

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